Worried about money

7 days, two people, Y200,000 for food and local transport will be heaps. The remainder for shopping.

I usually spend about 5,000 yen a day excluding hotel.
But I can easily survive with 3,000 yen a day or less.

Meals come as low as 500 yen and if you really want to scrimp, you can go to a convenience store (7-11 is one of these, they have everything) and get food for 100 yen upwards E.g. Onigiri (rice balls) oden (cooked boiled vegetables in soup like radish and tofu)
Grab a few for a light meal

In Kyoto, a restaurant that serves good local cuisine starts from about 3,500 yen per person. Usually about 7,000 to 11,000. Since you have 5 days, you can go to one such restaurant for the two of you once a day and still spend only 70,000 to 110,000 yen.

For transportation, buses are within 300 yen per ride. Trains within the city are within 400 yen. Trains from city to city are higher. Shinkansen (bullet trains) and airport express trains for your Kansai plan would not be anymore than 2,000 yen per ride. Worse case scenario is to walk or rent a bicycle (Kyoto is really small and most of Osaka main attractions are close by each other).

bank card, which is issued from the bank directly. if it does not work as a debit card, it will not work in Japan, because it is a bank original.
if a debit card has a mark of VISA, MasterCard, or some other major credit card brands, it will work at Post bank ATM and 7-11s, because it is similar to credit card.
the difference between credit card and debit card. the former card gives you a credit (post-payment), while the latter does not give you a credit (you have to have enough money in your bank account.)
when your balance is 100,000 yen, you may spend 200,000 yen with a credit card. but you only spend up to 100,000 yen with a debit card.
in both cards, the money transfer (exchange) will be performed through a credit card company, like VISA and MasterCard.
note that some Maestro card issued in EU may not work at Japan Post bank.

about exchange rate: you don't need to worry about the rate differences at airport and city areas. those are almost the same. currency exchange dealers at airports are mostly financial banks. each bank will offer the same rate at all branches in Japan.

For our 3 week trip for two, we've budgeted 351,000 Yen. Excluding hotels and transportation. If we can survive for 3 weeks on this, you should be laughing.

Our break down..
50,000 - admission to temples, museums, disneysea etc.
105,000 - cheap eating 5,000x 21 days
14,200 - the one hotel that accepts cash only at Miyajima
181,800 - left over for food "upgrading" and shopping

I realize this is a very tight budget, but we're just excited to be able to do this once in a lifetime adventure. We started planning this trip with just the hopes of just being able to survive - transportation, eat and sleep. The rest is just a bonus for us.